The Real Deal New York

Ziel Feldman’s HFZ in contract to buy huge W. Chelsea site

Updated 5:34, Nov. 26: Ziel Feldman’s HFZ Capital Group is in contract to buy one of the most sought-after development sites in West Chelsea, The Real Deal has learned. Feldman is buying the parcel for more than $800 million, making it one of the priciest-ever development deals in the city.

The block-long property at 518 West 18th Street runs between 17th and 18th Streets from 10th Avenue to the West Side Highway and holds more than 760,000 square feet of development rights, paving the way for Feldman to construct one of the largest buildings in the neighborhood.

The sellers were Edison Properties and its equity partners. If the deal closes at $1,000 per square foot, the price would be north of $800 million.

“Our partners have encouraged us to capitalize on the foresight our chairman had over 30 years ago, and we agreed,” an Edison insider said. “We expect that Ziel will now build one of the most iconic buildings on New York’s skyline.”

The property, which for years was operated as a parking lot, sits like a fallow gold mine amid the neighborhood’s real estate riches.

Edison, the New Jersey-based landlord that owns ancillary companies such as Edison Park Fast and Manhattan Mini Storage, has controlled the site since 1983 when it bought the property from Sol Goldman.

As real estate values in West Chelsea began skyrocketing, many in the development community were itching to take control of this site and others that Edison holds in the area, including a parking lot at the southeast corner of 20th Street and 10th Avenue. Feldman had offered to buy that property around two years ago when he was buying land to develop his 10-story condo building at 505 West 19th Street, sources said, but was rebuffed by Edison, which still operates it as a parking lot amid a growing forest of luxury developments.

Feldman’s new site allows for hotel, office and residential uses. He could construct a residential building larger than the 710-unit AVA Highline several blocks to the north, or a commercial building roughly four times the size of Barry Diller’s Frank Gehry-designed IAC Building next door.